BILL NUMBER: SB 1519 INTRODUCED
BILL TEXT
INTRODUCED BY Senator Bowen
FEBRUARY 20, 2002
An act to add Section 80111 to the Water Code, relating to
electric power.
LEGISLATIVE COUNSEL'S DIGEST
SB 1519, as introduced, Bowen. Department of Water Resources:
power.
(1) Existing law authorizes the Department of Water Resources to
enter into contracts for the purchase of electric power, to sell
power to retail end use customers and, with certain exceptions, to
local publicly owned electric utilities at not more than the
department's acquisition costs. Existing law provides that the
department retains title to all power sold by it to the retail end
use customers. After the passage of a specified period of time,
existing law suspends the right of retail end use customers to
acquire service from other providers until the department no longer
supplies power under these provisions.
This bill would authorize a retail end use customer who purchases
power from an electrical corporation to acquire renewable power
service, as defined, from an alternate provider if the customer
purchases and continues to receive electrical power with a minimum
renewable power content of 80% or greater. The bill would require a
customer who elects renewable power service from an alternate
provider to pay the department's net unavoidable costs of power
procurement attributable to that customer's purchases from the
department that are uncollected. The bill would authorize the
department, in certain circumstances, to impose a fee if a
nonresidential retail end use customer previously served by an
alternate provider acquires service from an electrical corporation.
This fee would be the obligation of the alternate provider where
customers are involuntarily returned to electrical corporation
service and alternate providers that are registered with the Public
Utilities Commission as electric service providers, would be required
to post adequate bonds or purchase insurance to cover the fee. The
bill would provide that the right of a retail end use customer who
has not purchased power from an electrical corporation, as defined,
on or after January 17, 2001, to purchase power from an alternate
provider, as defined, may not be limited by the bill. The bill would
require the commission to require each customer of an electrical
corporation to be notified of the conditions for purchasing power
from an alternate provider within 90 days of the effective date of
these provisions. Because a violation of an order of the commission
is a crime under existing provisions of law, the bill would impose a
state-mandated local program by expanding the definition of a crime.
(2) The California Constitution requires the state to reimburse
local agencies and school districts for certain costs mandated by the
state. Statutory provisions establish procedures for making that
reimbursement.
This bill would provide that no reimbursement is required by this
act for a specified reason.
Vote: majority. Appropriation: no. Fiscal committee: yes.
State-mandated local program: yes.
THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:
SECTION 1. It is the intent of the Legislature, in enacting the
act adding this section, to establish a policy to govern the
circumstances under which retail end use customers may choose to
acquire service from energy providers other than the Department of
Water Resources. The goal of that policy is to provide retail end
use customers the greatest possible flexibility in procuring power
while preventing any negative consequences for those customers who
continue to be served by the Department of Water Resources. It is
further the intent of the Legislature to recognize the genuine
contributions of new and renewable sources of electrical generation
to affordable, clean, reliable, and sustainable electricity service
for all California residents.
SEC. 2. Section 80111 is added to the Water Code, to read:
80111. (a) As used in this section, the following terms have the
following meanings:
(1) "Electrical corporation" means an electrical corporation, as
defined in Section 218 of the Public Utilities Code, serving the
customers for which the department is procuring power pursuant to
this division.
(2) "Alternate provider" means an entity, other than an electrical
corporation, supplying electrical power within the service territory
of an electrical corporation as the territory existed on January 17,
2001.
(3) "Renewable power" means electrical power produced from
geothermal, wind, solar, biomass, or landfill gas sources.
(b) The right of a retail end use customer who has not purchased
power from an electrical corporation on or after January 17, 2001, to
purchase power from an alternate provider may not be limited by this
section.
(c) Notwithstanding Section 80110 and subject to subdivision (d),
a retail end use customer who purchases power from an electrical
corporation may acquire renewable power service from an alternate
provider if the customer purchases and continues to receive
electrical power with a minimum renewable energy content of 80
percent or greater.
(d) A customer who elects renewable power service from an
alternate provider pursuant to subdivision (c) shall pay to the
department any uncollected amounts equivalent to the department's net
unavoidable cost of power procurement, including any financing
costs, attributable to that customer's purchases from the department,
as determined by the department. The department's net unavoidable
cost shall be calculated as the difference, if any, between the
department's total actual procurement costs and the rates collected
by the department from the customer during the term of service with
the department. Any amounts due pursuant to this section for the
purchase of power may be payable in installments over a term
coincident with the term of bonds issued to finance the purchase of
the power. If the customer submits a request to the department for
an estimate of the amount due, the department shall provide the
estimate to the customer within 30 days of the request.
(e) If a nonresidential retail end use customer previously served
by an alternate provider acquires service from an electrical
corporation, the department may impose a fee equivalent to any
unavoidable costs imposed on the department's portfolio attributable
to the load of that customer, if the fee is necessary to avoid
imposing costs on other customers of the electrical corporation, or
on the state. In the case of a customer who is involuntarily
returned to electrical corporation service by an alternate provider,
any such fee shall be the obligation of the alternate provider. As a
condition of its registration pursuant to Section 394 of the Public
Utilities Code, an alternate provider that is registered as an
electric service provider shall post a bond or demonstrate insurance
sufficient to cover such a fee.
(f) Within 90 days of the effective date of this section, the
commission shall require each electrical corporation customer to be
notified of conditions for purchasing power from an alternate
provider imposed by this section.
SEC. 3. No reimbursement is required by this act pursuant to
Section 6 of Article XIIIB of the California Constitution because the
only costs that may be incurred by a local agency or school district
will be incurred because this act creates a new crime or infraction,
eliminates a crime or infraction, or changes the penalty for a crime
or infraction, within the meaning of Section 17556 of the Government
Code, or changes the definition of a crime within the meaning of
Section 6 of Article XIIIB of the California Constitution.